Arizona Tourism and The Immigration Law Boycott: The Damage Done?

Arizona's controversial new immigration law, and the accompanying economic boycotts, are reminding some observers of other, not-too-distant economic protests.

Arizona was one of several U.S. states and cities that endured boycotts in the 1990s. At that time, Arizona refused to recognize the federal Martin Luther King, Jr., holiday. The state lost a lot of convention business due to the boycott, as well as Super Bowl XXVII -- which was moved from Tempe to Pasadena, California.

Colorado also went through a costly boycott in the early 1990s, after passage of a state amendment that nullified some existing gay rights laws. A 1992 plan to reduce Alaska's wolf population was shelved after animal-rights groups led a tourism boycott. And African-American organizations called for a nationwide pass on Miami, after the city's commission snubbed anti-apartheid activist and future South African President Nelson Mandela, for his support of Fidel Castro.

Hurting Those the Protests Aim to Help

The travel and hospitality industry makes up a large percentage of Arizona's economy. According to a study prepared for the state's Office of Tourism, Arizona's travel industry had direct earnings of $5 billion in 2008. And those numbers doubled when secondary travel industries, such as real estate, finance, government and construction, were added to the mix.

As the list of cities, public groups, universities and other organizations announcing travel boycotts to Arizona grows, there are concerns the backlash could have unintended consequences. "Arizona's hospitality industry ... is already greatly stressed because of the economy," says Jim Clark, president and CEO of the Fort Collins Convention & Visitors Bureau in Colorado. And it's the service industry employees, he says, many of whom are Hispanic, that "are going to get laid off when these boycotts kick into place, and it's going to hurt some of the very people it's aimed to help."

Clark knows his counterparts at the Tucson and Phoenix convention and visitors bureaus, cities that both depend on tourism. While he hasn't spoken with them since the immigration controversy broke, "I know they have their hands full right now," he says. "They're probably involved with a lot of communication with clients, stakeholders, and I would be surprised if they're not working at the political level, to see if some change can be affected. But there's probably only so much they can do. They've already been hammered by the recession...it's got to be tough."

How Much More Can Arizona Take?

Arizona's hospitality industry is trying to make its case directly to the public, including through a viral Internet campaign. The Don't Boycott AZ Tourism (Don't punish 200k tourism employees for politics!) page on Facebook says the state's new immigration law "has nothing to do with tourism, but some have decided to make tourism and the many innocent associates that represent this industry a scapegoat. The tourism industry is AZ's largest employer of minorities."

The Arizona Hotel and Lodging Association says the state's hospitality industry has had 65% of its funding reduced by the state legislature, "so our ability to respond to this issue with positive messaging is severely limited."

"Over the last 24 months," the Association says on its website, "Arizona tourism has suffered the effects of the recession, the 'AIG Effect' [public backlash against corporations holding lavish events], the Swine Flu, boycotts due to gun laws and now this. It's unclear how much more our industry can absorb while still providing our residents the tax revenue, job creation and quality of life that tourism provides."

Conventions Will Go Elsewhere

Arizona's top tourist seasons are autumn and winter, but boycott-related damage to the state's tourism industry is already evident. "Anybody who was planning on being in the desert southwest or the Rocky Mountain region, who was looking at Arizona, is probably not looking so hard anymore," says Dr. David Corsun, director of the School of Hotel, Restaurant and Tourism Management at the University of Denver's Daniels College of Business. "That means that business is going to be going from there to elsewhere."

And when other visitors and convention bureaus in the region are talking with convention planners, he says, "I can guarantee you ... that the subject is coming up. They know they're attracting business that might not otherwise have come their way."

Some groups have already pulled out of events in Arizona. But in many cases, says Jim Clark, the economic impact of the travel boycott won't be felt until "later on down the road. And that may be after the issue has already been resolved. Which is another reason that the boycotts are kind of troublesome, because the convention industry plans so many years in advance. It's the nature of the industry. It's going to be quantifiable as time goes on."